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Virtual Farm Reaps ProfitJuly 4, 2011 – 2:45 pm |
 Abdul Fattah Ismail |
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Zynga’s IPO bid last week for a reported $20 billion is not too surprising. The virtual social gaming application, according to the WSJ, generates a profit margin of more than 30% of prnot including stock compensation expenses. Unlike most games tied to social media networks, Zynga does little interactive marketing. Their pure product engages users to pay for tokens which are redeemed with one click. Another interesting point in the Journal article discusses the success of Zynga in the future.
Zynga‘s elevation was tied to their partnership through Facebook, whose wealth of personal data made it a simple driver for revenue growth. Executives at Zynga now seem to want their application to leave the nest, so to speak. They have yet to be a factor in Apple’s massive App Store, where users can sync digital content across platforms. Web analytics rank them outside of the top ten in downloads. Android represents another option should Zynga develop a program using its standards. Check that. Zynga has struck a partnership with AT&T to carry the mobile application.
In due time, it appears that Zynga will reap more of a digital harvest when the bid is accepted.
